FIGURE 1: TSH RESOURCES BERHAD LAST 2 YEARS SHARE PRICE TREND
**analysis based on 2018 annual report.
1. GENERAL INTRO: TSH is one of the main oil palm plantations in Malaysia.
2. NOTABLE POINTS:
a. In 2018 report, main business segments include operation of oil palm plantations and palm oil mills, which generates about 85% of the Group's revenue.
b. the Group operates oil palm estates in Sabah and parts of Kalimantan and Sumatra in Indonesia with a total planted area of 42,000 hectares and total annual fresh fruit bunches (FFB) production of 857,802 MT.
c. the group also operate 7 palm oil mills in Malaysia and Indonesia
d. the Group’s other business activities include the operations of biomass and biogas power plants in Sabah; industrial tree plantation at the Forest Management Unit in Ulu Tungud, Sandakan, Sabah; manufacturing and marketing of engineered hardwood flooring; and processing and marketing of cocoa products.
e. reported decreasing revenue in 2018 was due to lower CPO selling prices.
3. IS THIS COUNTER A STRONG GROWTH STOCK?
a. REVENUE RANGE (million): ~906.4 million in 2018 annual report, this is a medium revenue company.
b. SHARE PRICE: from 2018-2020, share price has been decreasing from around RM 1.60 to RM0.80, by end of 2019, abruptly raised to around RM1.50
c. EARNING PER SHARE (EPS): earning per share in last 5 years fluctuated from -7.85 to 10.31sen
d. FUTURE POTENTIAL/PROSPECTS: share price expect to be stable in the next few years
e. CAPITAL EXPENDITURE (CAPEX): spending on purchase of new fixed assets is RM 151 million, around 4% of total assets.
4. IS THIS A STRONG DIVIDEND STOCK?
a. DIVIDEND YIELD: in 2018 financial year, TSH declared a dividend payout of 2 sen per share to shareholders, which amounts to a dividend yield of 1.29%.
b. CONSISTENCY: the dividend payout was consistent, last five years (2015-2019) dividends declared range between 2 to 2.5 sen per share.
c. DIVIDEND PAYOUT RATIO: current financial year dividend payout ratio was 68%.
5. IS THE MANAGEMENT PERFORMANCE GOOD?
a. RETURN ON EQUITY (ROE): in 2018 financial year, TSH achieved a low return of shareholders’ equity, at 3.45%.
b. COST-TO-INCOME RATIO: cost-to-income ratio is high at 1010%.
6. OTHER INDICATORS:
a. CASH FLOW: cash flow is positive, around RM 99.9 million, equivalent to RM 0.07 per share
b. SUPPORT BY INSTITUTIONAL INVESTORS: this counter is moderately well supported by institutional investors, there are 15 institutional investors at top 30 major shareholders list, including EPF (7.05%), KUMPULAN WANG PERSARAAN (3.84%) and few insurance companies and investment funds. Its major shareholder is Datuk (Dr.) Kelvin Tan Aik Pen (12.23%).
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